Omarís case for 12th 5-year plan

So do J&Kís priorities support the 8 per cent growth target set for 2012-17?



In theory, activities in a plan are designed to help achieve objectives of a goal. Such activities need to clearly demonstrate through quantifiable outputs and outcomes how those objectives could be achieved.
Jammu & Kashmir state yet again has set a growth target of 8 per cent for the 12th Five-Year Plan period of 2012-2017. In the 11th 5-year Plan we are said to have achieved an aggregate growth of 6.2 per cent Ė well below the 8 per cent that we had aimed to achieve then.
The questions that we need to ask today are these: do the activities proposed by J&K for the 12th Five-Year Plan at the National Development Council (NDC) meeting at New Delhi last week really support our goal? And is the 8 per cent target realistic enough when we do not figure among the top five states projected to achieve 8+ per cent growth?
National Development Council (NDC) meeting is a forum where normally all chief ministers make a case for their states, unveil their economic visions for new plans and make political statements. Omar Abdullahís speech, read by Finance Minister, Abdur Rahim Rather, in his absence, is interesting.
Jammu & Kashmir state had made a case for Rs 68,000 crore for the 12th Plan. What we have got is Rs 44,000 crore.
On the proposed activities it is hard to see a clear growth strategy that will ultimately help in achieving an 8 per cent growth target. One of the most surprising elements of J&Kís plan was what it calls City Mobility Plan, for which it asked for Rs 30,000 crore. To put it simply, it means we plan to spend the significant chunk of our 5-year plan money on building two metro rail systems in Srinagar and Jammu cities. But is it wise to spend such money on city metro projects when we have other pressing priorities?
It is hard to imagine how building of two metro rail systems in our two relatively-small capital cities will support the 8 per cent growth target. Except for some labour force, there is hardly anything that could be sourced for these projects from J&K state. So whose idea is this? Do we really need such an expensive public transport system?
A simple look at the drivers of our growth would make anybody conclude that our priority must be activities that focus on tourism, horticulture and knowledge-based industries. In the absence of a decent public investment in tourism in J&K, our current rag-tag tourism is unsustainable. A major public investment in basic infrastructure like roads, power, public utilities, etc. is a pre-requisite for large scale private investment. J&Kís people today invest outside the state heavily and lend their money through banks to outside business because they donít have the right investment climate available. J&Kís 12th Five Year Plan will not be able to achieve an 8 per cent growth unless it aims a growth which targets local private investment.
Another folly that J&K is making is asking for central funding for honorarium of Panchs and Sarpanchs of the Panchayati system. A grassroots governance model which depends on salaries from the central government is not worth its salt. J&K must create conditions where Panchayati Raj institutions are able to raise their own resources, which should include salaries for its functionaries. It lacks theoretical sense as well as political wisdom to put a system of grassroots governance on such a path.
Omar Abdullah also made a case that makes both financial and political sense Ė seeking separate funding for police establishment. J&Kís stand that the police in J&K are fundamentally performing a national security job needs an empathetic hearing. The state has lost significant amounts of public money in policing in recent years - the money which in theory should be borne by the central government and not be the state from its own resources.
Similarly, Omarís plea that the centre should replace tied Special Plan Assistance for J&K with untied Special Central Assistance, a facility that could help J&K to overcome the limitations of a limited working season, makes good sense too.
J&K also repeated its promise to contain fiscal deficit and adhere to fiscal discipline. Interestingly, it has also committed itself to reduce PSUs losses, ensure timely completion of projects and strengthen institutional capacities. But how it actually achieves that remains to be seen.
J&K also repeated its demand for the transfer of Dulhasti and Salal Hydro electric projects. It also called for enhancement of power share from NHPC-run projects from 12 to 25 per cent. But did anybody take it seriously?
The columnist is a technical consultant in international development, covering Asia-Pacific and Africa regions

Lastupdate on : Sat, 29 Dec 2012 21:30:00 Makkah time
Lastupdate on : Sat, 29 Dec 2012 18:30:00 GMT
Lastupdate on : Sun, 30 Dec 2012 00:00:00 IST

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